The crisis or the housing bubble of the United States during 2008-09 affected us a LOT! It had severe consequences, including one of the serious economic recessions in history since the 1930’s, when the Great Depression hit, casting millions of Americans their jobs. The purpose of this blog is to discuss the economic causes of the housing crisis and how it led to the 2007-09 recession 9it originally started in 2007), evaluate the federal government’s response to the recession, and recommend change in policy.
Even after more than a decade (this is 2023 now), the housing crisis underlying factors are considered to be rather severe and complex. Its causes are believed to be speculative fever, failure of regulators to intervene, tax lending standards, historically low-interest rates, and tax policy. What is more, unregulated markets and predatory private mortgage lending were also considered to be the reason for the housing crisis to begin and become so serious. The 2007-09 recession, like I said, was the worst in history.